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April 24 2018

moneymetals

China Takes the Long View on Gold-Silver... and So Should You

A cursory look at Chinese history can convince you that China should not be underestimated when it sets its sights on a particular goal.

Even before Mao Zedong took over the reins in 1949, and the first Five Year Plan began in 1953, centuries of history demonstrated that long-term planning, while not always meeting expectations, is a core behavioral trait of the Chinese psyche.

And more often than not, it has enabled them to hit the mark.

Expect eventual success for the One Belt, One Road Initiative – the world's largest construction project, estimated to cost $80 trillion dollars – linking the Asian mainland, (including Central Asia) with Europe via high speed rail, communications links and vibrant financial trading platforms.

And expect this project to be a major factor in bringing about what Doug Casey and others believe could become the greatest commodities bull-run that most of us now living are going to see.

The petro-yuan. A game-changer?

And oh, by the way, China recently officially launched a petro-yuan contract at the Shanghai International Energy Exchange. It marks the first time overseas investors have been able to access a Chinese commodity market – an oil futures contract – that can be settled, not only with U.S. dollars, but also Chinese Yuan, eventually a basket of currencies... and gold.


Continue Reading (source)

January 19 2018

moneymetals

Chinese Physical Gold Investment Demand Surges While Americans Pile Into Stock & Crypto Bubbles

Chinese demand for physical gold investment surged in the first three-quarters of 2017 while Americans ditched the shiny yellow metal for increased bets in the crypto mania and stock market bubble market. Even though China’s Hang Seng Stock Market outperformed the Dow Jones Index last year, Chinese citizens purchased the most gold bar and coin products Q1-Q3 2017 since the same period in 2013, when they took advantage of huge gold market price selloff.

According to the World Gold Council, Chinese gold bar and coin demand increased to 233 metric tons (mt) in the first three-quarters of 2017 compared to 162 mt in the same period last year. Furthermore, if we include Indian gold bar and coin demand, China and India consumed nearly half of the world’s total:

Global gold bar & coin demand q1 - q3 2017

As we can see, China and India consumed 338 mt of gold bar and coin products which accounted for 47% of the total 715 mt Q1-Q3 2017. German gold bar and coin demand of 81 mt took the third highest spot followed by Thailand (49 mt), Turkey (47 mt), Switzerland (31 mt) and the United States (30 mt). Chinese gold bar and coin demand of 233 mt nearly equaled the total demand by German, Thailand, Turkey, Switzerland and the United States of 238 mt.


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January 05 2018

moneymetals

Gordon Chang: Blowup w/ China or North Korea Could Change Almost Everything Overnight

Without further delay, let's get right to this week's exclusive interview. 

Gordon chang

Mike Gleason: It is my privilege now to welcome in Gordon Chang, author, television pundit, and columnist at the Daily Beast. Gordon is a frequent guest on Fox News, CNBC, and CNN, among others, and is one of the foremost experts on Asian economics and geopolitics, having written books on the subject and it's great to have him back on with us.

Gordon, it's a real honor to have you on again, and thanks so much for your time today. I know it's been a busy week for you given all of your media appearances, and we're grateful that you could join us today. How are you?

Gordon Chang: I'm fine, thank you, and thank you so much, Mike. I really appreciate the opportunity.

Mike Gleason: Well, there are many things to cover here given all that's going on right now. We certainly appreciate your expertise, particularly when it comes to the developments in Asia. There's a lot going on in that part of the world with big implications for investors. Let's start with North Korea. That's obviously been at the forefront of the news this week with tensions getting ratcheted up again.

Kim Jong-Un and President Trump are both bragging about their nuclear arsenals. The over the top posturing on both sides makes it hard to gauge just how seriously the threat of nuclear exchange should be taken. The market seems to have stopped paying attention for the most part. Please give us your thoughts on the matter. Is there any likelihood the disagreement over North Korea's nuclear weapons program will escalate beyond words, Gordon, or is this war only going to be fought on Twitter?

Gordon Chang: If you look at Twitter, this certainly is a matter of concern, but I think the reality is much different. Right now, Kim Jong-Un, the ruler of North Korea, is feeling sanctions. We saw a hint of that in his New Year's address where he referenced it, at least indirectly, and at one point he actually called the sanctions an existential threat.

What he's trying to do right now with his overture to South Korea is to get the South Koreans to shovel money into his regime. What he would like in return for sending two figure skates to the winter Olympics in South Korea next month would be for South Korea to lift sanctions to resume inter-Korean projects, like the Kaesong Industrial Complex, and also for more North and South Korean aid.

I don't think that those expectations are realistic. Some of what he wants would be a violation of UN sanctions, and President Trump's policy has been to cut off the flow of money to Pyongyang so it can't launch missiles or detonate nukes. This is going into, I think, a very crucial period, because if you look back in history, and I'm talking seven decades, we have seen North Korea engage in military provocations shortly after making peace overtures. And this whole concept of the Olympics and his opening of dialog with South Korea, that's a peace overture.

Mike Gleason: We've got two huge wild cards at the forefront of all this with President Trump and Kim Jong-Un being rather unpredictable, to say the least. Is Trump's tit-for-tat responses to his adversary here going to make diplomacy harder to achieve as our allies might have a hard time joining in full force to combat the North Korean threat?

Listen/Read the entire podcast here: (source)

November 28 2017

moneymetals

Gold's Global Supply Artery: Heading for Cardiac Arrest

Inline image 1

An oceanic-scale demand push from "all parts Far East" is building, as the desire to own gold and silver promises to place an increasingly solid foundation for years to come.

China, India, and Southeast Asia have historically accumulated precious metal as a savings vehicle, a hedge against political uncertainty (e.g. India's surprise call-in last year of 80% of the country's paper currency), and as an expression of affection. China's newly-emerging affluent middle class alone is set to become larger than the population of the U.S. Frank Holmes collectively refers to these elements as "love and fear trades".

China's One Belt-One Road (OBOR) Initiative – the world's largest-ever construction project – is designed to link 60% of the world's population in a cooperative financial and economic matrix. Taken together, the continued migration of gold supply from West to East is baked into the cake.

For a deeper understanding of how and why China is leading the charge – and going about capturing an outsized portion of the global gold supply – see my essay from last summer, titled China's Get the Gold Plan: Part II.

Even as the West ships much of its remaining gold eastward (largely via Swiss refineries who "repurpose" it into .9999 fine gold), countries like Germany and Turkey have stepped up to the plate, becoming noteworthy demand drivers in their own right.

Fund managers are finally realizing that gold deserves to be a permanent portfolio asset holding category. In The Morgan Report and in Riches in Resources, David Morgan has written extensively about this for both individual investors and institutional clients. Just one more "silent lever" by which a long-term, rock-solid foundation is being built under gold's demand... and price.

Continue to the full article (source)

October 31 2017

moneymetals

BREAKING: China – World’s Largest Gold Producer Mine Supply Plummets 10%

Inline image 1

The world’s top gold producer saw its mine supply plummet by 10% in the first half of 2017. According to the GFMS World Gold Survey newest update, China’s gold production in 1H 2017 fell the most in over a decade. The fall in Chinese gold production is quite significant as the country will have to increase its imports to make up the shortfall in its mine supply.

The data in the GFMS 2017 Q3 Gold Survey Update & Outlook reported that Chinese gold mine supply declined 23 metric tons to 207 metric tons in the 1H 2017 versus the 230 metric tons during the same period last year:

China gold mine production (1h 2016 vs 1h 2017)

The report stated the reason for the decline in Chinese gold production was due to the government’s increased efforts to curb pollution as well as heightened awareness of environmental protection. Furthermore, GFMS analysts forecast that Chinese gold production will continue to deteriorate for the remainder of the year as production is scaled down.

Read full article: (source)

September 11 2017

moneymetals

THE U.S. PETRO DOLLAR BREAKDOWN CONTINUES: Big Moves In Gold & Silver Ahead

The four-decade long monopoly of the U.S. Petro-Dollar as the world’s reserve currency is coming to an end. Unfortunately, most Americans have no clue that when the Dollar loses its reserve currency status, life will get a lot tougher living in the U.S. of A. Let’s say, Americans will finally receive “Precious metals religion.”

The U.S. Dollar Index fell considerably yesterday and is now down below a key support level. In early morning trading yesterday, the U.S. Dollar Index fell to 91.46, down 73 basis points:

U.S. dollar index (index: $dxy) chart

According to technical analyst, Clive Maund, in his recent article, DOLLAR update as LOSS OF RESERVE CURRENCY STATUS LOOMS..., he stated the following:

The dollar is on course to lose its reserve currency status. This is not something that will happen overnight, it will be a process, but at some point there is likely to be a “sea change” in perception, as the world grasps that this is what is happening, which will trigger a cascade of selling leading to its collapse, whereupon gold and silver will rocket higher.

In that article, Clive posted the following chart on the U.S. Dollar Index (USD index) and its key support level:

U.S. dollar index - cash settle (eod) ice chart | august 25, 2017

As we can see, traders are looking closely to the Key support area at 92.5 for the USD index. With the USD index now below that key support area, it could spell real trouble for the Dollar if it closes below that level at the end of the week. After the markets opened today, the Dollar fell to a low of 91.08. So, it looks like the Dollar will close this week well below the key support area.

Now, part of the reason for the selloff in the Dollar may have been due to the disaster that took place in the 10-year U.S. Treasury Repo market today. According to Zerohedge’s article “We’ve Never Seen Anything Like This”: Repo Market Snaps As 10Y Suffers “Epic Fail”:

10 year note repo rate chart

The dollar is on course to lose its reserve currency status. This is not something that will happen overnight, it will be a process, but at some point there is likely to be a “sea change” in perception, as the world grasps that this is what is happening, which will trigger a cascade of selling leading to its collapse, whereupon gold and silver will rocket higher.

The pressure on the U.S. Treasury 10-year repo market is likely a reaction to what came out of the annual BRICS summit in China yesterday, According to the article, Escobar Exposes Real BRICS Bombshell: Putin’s “Fair Multipolar World” Where Oil Trade Bypasses The Dollar:

“To overcome the excessive domination of the limited number of reserve currencies” is the politest way of stating what the BRICS have been discussing for years now; how to bypass the US dollar, as well as the petrodollar.

Beijing is ready to step up the game. Soon China will launch a crude oil futures contract priced in yuan and convertible into gold.

This means that Russia – as well as Iran, the other key node of Eurasia integration – may bypass US sanctions by trading energy in their own currencies, or in yuan.

This announcement by Putin that oil trade should by-pass the Dollar came a few days after China announced that they plan to start trading oil on their Shanghai Exchange in Yuan, which will be backed by gold. While we have heard for years that China was going to back their currency or trade with gold, we now see actual plans to start implementing it sometime this year.

By China backing its new oil trading benchmark in Yuan with gold, it provides countries with a great deal of confidence in trading oil in another fiat currency besides the U.S. Dollar. Thus, countries that acquire a lot of Chinese Yuan by trading oil don’t have to worry about devaluation as they can convert Yuan into gold. 

Continue to read the full article. (Article Source)

September 05 2017

moneymetals

China Puts Oil on a Gold Standard

The Chinese are preparing to launch an oil futures contract denominated in yuan and redeemable in gold. That is very bad news for the petro-dollar and for U.S. hegemony in the oil trade. The ability to sell oil on Chinese exchanges for yuan will take the potency out of U.S. sanctions levied on nations such as Russia and Iran.

Gold in china

The gold backing of those contracts figures to lure participants from around the globe – even those with strong ties to the U.S. This additional enticement will go a long way toward allaying concerns of those who may see the dollar as superior to the yuan in trade.

The move is another sign of the Chinese commitment to ending the dollar’s reign as the world reserve currency.

The oil contract, to be traded on the Shanghai International Energy Exchange, will be the China’s first futures contract which is open to international firms for trading. There is no official word on when the contract will launch, but testing has been underway since July.

Original Source

August 24 2017

moneymetals

July 21 2017

moneymetals

CLOSE TO NEW GOLD STANDARD? Australia Exports Record Amount Of Gold To China

Are the Chinese getting close to announcing a new gold-backed currency? Well, if the record amount of Australian gold exports into China is an indicator, it may be close at hand. While the Chinese have been importing a lot of gold from Australia, it reached a new record high in 2017.

According to the recently released data by the Australian Government June 2017 Resources and Energy Quarterly, Australia exported more gold to Hong Kong and China during the first quarter of 2017 than any other quarter in history.

Australian gold exports to Hong Kong and China were 54% higher Q1 2017 versus the same quarter last year:

Australian gold exports to hong kong & china

As we can see in the chart above, Australia exported 57.4 metric tons (mt) of gold in Q1 2017 compared to 37.2 mt Q1 2016. What a difference in ten years. Australian gold exports to Hong Kong and China were nonexistent in 2008. However, after the U.S. and global market meltdown that year, China started to import more gold, especially since 2011.

Even though I compared Q1 2017 Australian gold exports to China to the first quarters of previous years in the chart above, the data for all quarters shows that the present quarter is the highest amount on record.

Furthermore, Australia is now exporting the majority of its gold to Hong Kong and China. For example, of the total 75 mt of Australian gold exports Q1 2017, 57.4 mt or 77% went to Hong Kong and China.Here was the breakdown for Q1 2017.


Continue reading...

July 03 2017

moneymetals

Jim Rickards on the War on Gold, the Coming China Collapse & War w/ North Korea

Well now, let’s get to the much-anticipated explosive conclusion of last week’s conversation with Jim Rickards, author of multiple best-selling books, renowned economic commentator and portfolio manager.  And we’ll pick up the conversation with a question about the War on Cash and the War on Gold.

Mike Gleason: I wanted to ask you about a tweet you sent out earlier this month – and for people who want to follow you there, it's @JamesGRickards – but in that tweet you wrote:

Just informed that Scotia Bank branch is now a gold buyer only. Will not sell to retail clients. Get it while you can. War on gold is here.

Expand on that here, Jim. What did you make of that move and why did you make those comments?

June 01 2017

moneymetals

CHINA’S INDUSTRIAL SILVER FABRICATION TUMBLES: A Bad Sign For The Global Economy

The once Great Chinese Dragon Economy seems to be burning out as its economic indicators continue to weaken and smolder. One such indicator is China’s rapidly falling industrial silver consumption. At one time, Chinese industrial silver fabrication was consuming nearly a third of the global total. However, this has fallen considerably over the past two years.

According to the data in the 2017 World Silver Survey, China’s industrial silver consumption fell 15% in 2016, from 169 million oz (Moz) in 2015 to 144 Moz last year. That’s a 25 Moz decline in just one year:

Chinese industrial silver fabrication 2007-2016

Furthermore, Chinese industrial silver fabrication has fallen 23%, (42 Moz) from its peak of 186 Moz in 2014. While some may believe the decline in China’s industrial silver usage had something to do with rising silver prices. This couldn’t be, as the average annual silver price was $19.08 in 2014, $15.68 in 2015 and $17.14 last year.

So, as we can see, the Chinese consumed a great deal more silver for industrial silver applications when the price of silver was higher in 2014 than either 2015 or 2016. Which means, it had nothing really to do with the price. That being said, there is an even more alarming trend.

Continue reading the article: https://goo.gl/L0TaCu

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